AMD 2000 Annual Report Download - page 383

MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
OPERATIONS
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2000 1999
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(Thousands except contract rates)
Notional Average Estimated Notional Average Estimated
amount contract rate fair value Amount contract rate fair value
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Foreign currency forward
contracts:
Japanese yen $ 54,915 110.22 $ (781) $ 2,425 103.11 $ 4
British pound 5,103 1.45 (16) 1,219 1.63 10
Swiss franc - - - 318 1.57 (1)
European Union euro 134,867 0.88 (1,602) 45,101 1.03 (611)
Singapore dollar 5,573 1.70 7 8,382 1.67 17
Thai baht 6,712 39.52 (619) 1,245 40.18 48
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$ 207,170 $ (3,011) $ 58,690 $ (533)
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RISK FACTORS
Our business, results of operations and financial condition are subject to a
number of risk factors, including the following:
Microprocessor Products
Dependence on AMD Seventh-Generation Microprocessors. We must successfully
market our seventh-generation Microsoft Windows compatible microprocessors, the
AMD Athlon and AMD Duron microprocessors, in order to increase our
microprocessor product revenues in 2001 and beyond, and to benefit fully from
the substantial financial investments and commitments we have made and continue
to make related to microprocessors. We began volume shipments of AMD Athlon
microprocessors in the second half of 1999. We began shipments of AMD Duron
processors, a derivative of the AMD Athlon processor designed to provide an
optimized solution for value-conscious business and home users, in the second
half of 2000. Our production and sales plans for AMD Athlon and AMD Duron
microprocessors are subject to numerous risks and uncertainties, including:
. our ability to maintain average selling prices of seventh-generation
microprocessors despite aggressive Intel marketing programs and
product bundling of microprocessors, motherboards, chipsets and
combinations thereof;
. whether Tier One OEM customers will use our seventh-generation
microprocessors in systems developed for the commercial market;
. our ability to successfully offer new higher performance versions of
the AMD Athlon microprocessor competitive with Intel's Pentium III and
Pentium IV processors;
. our ability to produce seventh-generation microprocessors in the
volume and with the performance and feature set required by customers
on a timely basis;
. our ability to expand our chipset and system design capabilities;
. the pace at which we are able to ramp production in Dresden Fab 30 on
0.18-micron copper interconnect process technology;
. the availability and acceptance of motherboards and chipsets designed
for our seventh-generation microprocessors; and
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Source: ADVANCED MICRO DEVIC, 10-K405, March 20, 2001